Confidential information EFKO GROUP EFKO TODAY EFKO Group is one of the largest food producers and fat-and-oil holdings of the Eurasian Economic Union (EEU) 01 05 Turnover: $4,8 billion for 2022 Unique focus on R&D and new innovative products development 06 №1 sunflower oil export from Russia 15 production units 02 07 Over 17 thous. employees Well-known food brands 03 Top 100 in the list of largest EEU private company 08 04 Multiple winner of the quality food awards Own R&D center efko.ru 2 2 Own scientific and educational center • Biotech cluster • UAV cluster • Educational center 3 Scientific center ”BIRUCH” • 14 Leading scientific institute in eco 12 laboratories 500 employees 100 scientists and engineers 4 Strong connection to the Fundamental Science • 3 Scientific advisory board • 10 Academicians on the boards 14 Leading fundamental Scientific Institutes in our eco-system 5 CORPORATE UNIVERSITY Marketing and branding Production management Sales HR Biotech Innovation management 6 500 students in a year \ 12 000 studying hours per year HI-PROJECTS FAMILY HEALTHY FUTURE THROUGH HEALTHY INNOVATION The “Healthy Innovation” projects line are based on technologies that improve people's lives qualitly, care for the environment and have the potential for mass production (are affordable). HI – Food HI – Bio HI – Meat HI – Milk HI-Protein HI-Nutrition Plant-based meat Plant-based milk Healthy sweetener Cellular nutrition Oleogeneration in microorganisms Enzymes for food industry HI – Tech Rare sugars (tagatose, allulose) Starter cultures HI-Fly HI-Energy Air-taxi and cargo drones Membrane technologies 7 UNIQUE SCIENTIFIC ECOSYSTEM The competitiveness of the Hi family of projects is based on a scientific ecosystem that includes leading Russian scientists and scientific achievements accumulated in the leading scientific organizations of the country. ICG The ecosystem of Hi-projects includes: 11 academicians of the Russian Academy of Sciences More than 150 scientists from leading scientific centers In addition, the Company invested more than $200 million in the creation of laboratories and pilot production facilities in its own R&D center, where technologies are tested and industrially adapted. biruch.ru 8 SUGAR AS A WORLD PROBLEM Rising incidence of diabetes and obesity– one of the key global health challenges 2019 2,3 2019 mil people 537 mil people 2000 151 bn people 650 2021 1990 1,67 1980 217 bn people mil people mil people number of people with diabetes number of obese people number of people suffering from deep caries on permanent teeth proved* that the main reason for these trends is excess sugar intake. biruch.ru 9 Global, regional, and national incidence, prevalence, and years lived with disability for 354 diseases and injuries for 195 countries and territories, 1990–2017: a systematic analysis for the Global Burden of Disease Study 2017. International diabetes federation https://diabetesatlas.org/idfawp/resourcefiles/2021/07/IDF_Atlas_10th_Edition_2021.pdf World Health Organization https://www.who.int/news-room/fact-sheets/detail/obesity-and-overweight Lancet. 2018 Nov 10; 392(10159): 1789–1858. doi: 10.1016/S0140-6736(18)32279-7 *Lang A, Kuss O, Filla T, Schlesinger S. Association between per capita sugar consumption and diabetes prevalence mediated by the body mass index: results of a global mediation analysis. Eur J Nutr. 2021 Jun;60(4):2121-2129. doi: 10.1007/s00394-020-02401-2. SWEET PROTEINS - HEALTHY ALTERNATIVE TO SUGAR Sweet proteins - protein molecules that are naturally found in small quantities in some fruits of the equatorial belt They are 800 to 3,000 times sweeter than sugar, but do not increase blood glucose levels.. 01 BRAZZEIN Pentadiplandra 02 MONELLIN Serendipe berry 03 THAUMATIN Katemfe fruit THE EXTRACTION OF NATURAL SWEET PROTEINS IS NOT ECONOMICALLY EFFICIENT. THEREFORE, SCIENTISTS ALL OVER THE WORLD ARE WORKING TO CREATE A BIOTECHNOLOGICAL METHOD FOR THE PRODUCTION OF SWEET PROTEINS. biruch.ru 10 Total addressable Market $60 billions PROJECT OBJECTIVE – production of the "sweet proteins" at a lower cost compared to sugar The Company has achieved the following results : • technology for obtaining brazzein (equivalent in structure to natural) has been developed • technology for obtaining monellin (equivalent in structure to natural) has been developed • pilot production of sweet proteins started in Russia • formulas for the use of sweet proteins in final products (drinks, ice cream, confectionery) have been developed Next steps: - increase the level of sweetness of sweet proteins several times by modifying the structure of the protein - large-scale studies of the metabolism of sweet proteins biruch.ru 11 THE FIRST SWEET PROTEIN FACTORY IN THE WORLD (in Russia) A factory expansion project is currently underway. biruch.ru 12 OLEOGENERATION IN MICROORGANISMS For thousands of years, human metabolism has remained virtually unchanged, so it is fair to assume that fatty acid triglycerides will remain one of the key building materials in the human body. Currently, the main source of fats in the human diet are processed oilseeds. The problem is that the cultivation of oilseeds is very demanding on climate and soil quality. This leads to a small number of countries (Indonesia, Malaysia, Brazil, etc.) “feeding” the whole world with vegetable oils, which entails huge costs for the logistics of oils around the world. An alternative is the production of fats through biotechnology. The development of these technologies may make it possible to produce fats regardless of climatic conditions and soil quality. The production of edible oils and fats with desired properties using biotechnology is under development. biruch.ru 13 ENZYMES Enzymes are proteins that act as biological catalysts by accelerating chemical reactions. Some of them give great advantages and widely used in the food processing industry: In sauces and dressings: • • Increases emulsifying properties egg yolks or whole eggs Increases heat resistance In bakery: • • • • мakes bread volume expand extends the shelf life improves the structure and softness improves the stickiness of the dough biruch.ru 14 ENZYMES Russian market is completely dependent on the import of enzymes. Therefore, we decided to develop enzymes on our own. It all started with a laboratory and today the Company already have a full-size enzyme factory that is successfully operating and supplies The Company mayonnaise production with phospholipase A2 enzyme. Under development many others enzymes for food production. biruch.ru 15 LIVESTOCK PRODUCTS SUBSTITUTION AS AN INEVITABILITY TO SAVE THE PLANET Increased consumption of MEAT AND DAIRY PRODUCTS leads to the depletion of the planet's resources and ecological catastrophe By 2050, more than half of the planet's land and water will be used for livestock industry. THE AVERAGE FARM GENERATES AS MUCH WASTE AS A CITY OF 500,000 POPULATION animals produce more greenhouse gases than all the vehicles in the world biruch.ru Food and Agriculture Organization of the United Nations «Water for Sustainable Food and Agriculture». A report produced for the G20 Presidency of Germany, Rome 2017 «Livestock`s long shadow environmental issues and options», Rome 2006 International Livestock Research Institute Thornton, P., Herrero, M. and Ericksen, P. 2011. Livestock and climate change. Livestock Exchange Issue Brief 3. Nairobi, Kenya: ILRI. 16 Greenpeace «Report: Farming for Failure» Animal Frontiers Dominic Moran, Eileen Wall, Livestock production and greenhouse gas emissions: Defining the problem and specifying solutions, Animal Frontiers, Volume 1, Issue 1, July 2011, Pages 19–25 The Guardian «EU's farm animals 'produce more emissions than cars and vans combined» United States Environment Protection Agency Barth*, E F., J L. Cicmanec*, J Goetz*, M M. Hantush*, R F. Herrmann**, P T. McCauley*, K. A. McClellan*, M A. Mills**, T L. Richardson*, S Rock*, S. Stoll, G Sayles*, J E. Smith*, AND S. Wright. «Risk management evaluation for concentrated animal feeding operations», washington, d.c., epa/600/r-04/042, 2004. PLANT-BASED MEAT AND MILK ARE AN SUSTAINABLE SUBSTITUTE FOR ANIMAL PRODUCTS We understand that it is simply impossible to refuse food that brings so much pleasure in a world of ever-increasing stress. Therefore, the food of the future should be: Delicious Healthy Total addressable market MEAT - $1.4 trillion MILK - $0.9 trillion Eco-Friendly PROJECT OBJECTIVE IS TO CREATE DELICIOUS AND AFFORDABLE FOOD PRODUCTS, WHICH WILL ENSURE A HEALTHY FUTURE FOR OUR CHILDREN AND THE WHOLE PLANET 01 biruch.ru EFKO experts evaluation plant-based MEAT Burger, nuggets, meatballs, etc. 02 plant-based MILK PRODUCTS Milk, yogurt, cheese, cream cheese, etc. 17 ANALYSIS OF COST SCENARIO OF PLANT-BASED PRODUCTS Comparative analysis of raw materials cost 3,7 $/kg 3,2 $/kg 1,5 $/kg Plant-based burger (third party provided ingredients) Plant-based burger Meat burger (beef) (fully integrated model) Production of plant-based products is efficient and could be affordable for mass market only in the fully integrated model. biruch.ru EFKO experts evaluation 18 EXISTING BRANDS 19 COMPETITOR ANALYSIS Currently, there are several companies in the world engaged in plant-based products development and sales* Hi-Protein Year of foundation 2009 2011 1990 2015 2014 2020 Headquarters USA USA Sweden Chile USA Russia Product Plant-based meat Plant-based meat Plant-based milk Plant-based milk Plant-based milk Plant-based meat and milk Venture investments 0,5 bn $ 2 bn $ 1,4 bn $ 0,36 bn $ 0,2 bn $ 0,1 bn $ ESTIMATED VALUE 1,5 bn $ 7 bn $ 10 bn $ 1,5 bn $ 0,4 bn $ ??? $ 20 *Global companies the only business of which is the plant-based products (source – PitchBook database, own estimation) PILOT SALES EXPERIENCE IN THE UAE At the moment plant based meat is present in 11 retail outlets in supermarket chains Union Coop and Fresh mart, Full Cart minimarkets, free-standing minimarkets in areas with high purchasing power (for example, Dubai Marina). Assortment of vegetable meat for test sales Hi Burger cutlets 400 gr, Hiballs 280 gr, Hibeef 400 gr. (minced meat) biruch.ru 21 OFFTAKE : FIRST RESULTS Based on two weeks sells average per day offtake is 0,6 packs per store*. This is by 50% bigger then Hi’s performance in Russia. Which shows Dubai’s consumers readiness to plant based products. At the same time offtakes is less then competitors. This will be improved with marketing support which will help to introduce Hi plant based meat to the shoppers. Sales per store (units per day) biruch.ru Dubai Russia Hi 0,6 0,4 Index to competitors 0,8 1 22 *Based on sells 08Aug-19 Aug 2022 In order to ensure the economic efficiency of pantbased products, the Company has developed a set of structural technologies that provide the possibility of completely independent production of all key components. 01 plant-based raw materials (soya, sunflower, seaweeds) Nutrients for microorganisms 02 plant-based protein 03 plant-based MEAT AND MILK PRODUCTS plant fibers (oil biosynthesis, sweet protein) Production of flavoring substances Production of components for flavoring substances biruch.ru 23
